South Carolina voters overwhelmingly passed a referendum on Tuesday permitting the state investment commission to invest retirement plan assets in international equities and private equities for the first time. A new law will likely go into effect in January.
"We supported it very strongly, and it removes the last obstacle on investments for us," said Reynolds Williams, chairman of the South Carolina Retirement System Investment Commission, Columbia, which oversees $26 billion in state retirement assets. "We are no longer restricted from any material investment opportunities."
Mr. Williams said the commission will likely carve out a 10% to 20% international equity allocation and a 5% private equity allocation. The commission will meet later this month to adopt a new asset allocation that could also include first-time allocations to alternatives, including real estate and hedge funds.
The referendum, which failed in 2002, passed with 70% approval.
The commission currently invests 50% of assets in equities; state laws permit an equity allocation of up to 70%, Mr. Williams added.
In Iowa, Democrat Chet Culver won the race for governor, carrying a platform that included having the $20 billion Iowa Public Employees' Retirement System invest 1% of assets in venture capital in the state. His Republican opponent, Jim Nussle, had opposed the idea as risky.
John Hedgecoth, policy director for the Culver campaign, said the proposal would give officials at the Des Moines, Iowa-based fund discretion on how it would make the investments.